After the videogame crash of 1984, ground zero for game development moved to Japan. During the 8-bit generation, a majority of games flowed across the Pacific and Japanese games became the taste-makers. Thousands of games were localized from Japan for the NES, Genesis and SNES. This trend continued up to the original PlayStation, at which point more and more development houses were springing up in America, Canada, and Europe. Some of the biggest hits of the generation, such as Tomb Raider, were created by western developers. Rare, based in England, was a powerhouse developer for Nintendo. Insomniac and Naughty Dog, two of Sony's bigger second-party candidates are in California.

The see-saw between East and West continued to wobble through the PS2-led generation. The two biggest non-sports games were created by western developers: Bungie's Halo and Rockstar's Grand Theft Auto III. Bioware and Pandemic, acquired by Electronic Arts last year, rose to great prominence. Ubisoft, based in France but with development studios all over the world, became a massive force in the industry.

Many of the biggest hits of this generation were developed outside of Japan. Ubisoft's Assassin's Creed has sold over 2.5 million units. The million-selling Mass Effect was developed in Canada at Bioware. BioShock hails from 2K Boston (formerly Irrational). And, lest we forget, there's Halo 3. Nintendo's biggest successes still come from Japan -- Super Mario Galaxy, Zelda, Brain Age, etc. -- but western developers that seriously underestimated the staying power of the Wii are scrambling to catch up.

Japan is no longer the capitol of gaming, as that is unlikely to change in the next 10 years, especially as the bulk of videogame sales shift to America and Europe. It is only natural for developers catering to what some have called "western sensibilities" to pull in North American and European talent. There will always be major players coming from Japan, such as this year's Metal Gear Solid 4 and perhaps even Final Fantasy XIII, but the balance has shifted. And money is what pushed it.

Your Console Does Wha?

The Atari 2600 did only one thing. The NES did only one thing. The Genesis did only one thing.

These machines only played videogames.

But when consoles switched over to the disc medium with the PlayStation, hardware makers started introducing more and more functionality. The PSone and Saturn played music CDs. The Xbox and PS2 played DVD movies. And it just kept going from there. This current batch of consoles plays high-definition movies, browses the web, sends messages. At CES, Sony announced that the PlayStation Portable would support Skype. The PS3 even helps cure diseases with the Folding program. (Which is still pretty cool.)

Not a selling point, but cool nonetheless.

What will the next generation of consoles pull off? Expect basics like movie and music playback since those appear to be standard (except to Nintendo), but look for more added functionality as both a value adder and a bullet point. Messaging could play a larger part, especially as gamers continue to pick up on VoIP and embrace social communities. If Sony's Home takes off, don't be surprised if future consoles also employ Second Life-esque virtual spaces.

Regenerative Health

Forget first aid kits and health packs. Regenerative health, introduced in the original Halo game for the Xbox, ditched frantic hunts for med-kits in favor of a mechanic that kept players in the game as long as they could just find a rock to hide behind. Hardcore gamers bemoaned it, more casual gamers appreciated the helping hand. And when the Halo series sold a bazillion copies, the switch was made. Lots of games now use regenerative health, such as Call of Duty. And lots more will.